Sharon Mcgrath v Secretary of State for Work and Pensions
| Jurisdiction | England & Wales |
| Judge | Mr Justice Cranston |
| Judgment Date | 20 April 2012 |
| Neutral Citation | [2012] EWHC 1042 (Admin) |
| Court | Queen's Bench Division (Administrative Court) |
| Date | 20 April 2012 |
| Docket Number | Case No: CO/560/2011 |
[2012] EWHC 1042 (Admin)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Justice Cranston
Case No: CO/560/2011
Paul Stagg (instructed by The Public Law Project) for the Claimant
Jason Coppel (instructed by Office of the Solicitor to the Department for Work and Pensions) for the Defendant
Hearing dates: 18 April 2012
Introduction
In this judicial review the claimant challenges the decision of the Secretary of State for Work and Pensions to recover from her an overpayment of income support in 1996 and 1997 by way of the deduction from current payments to her of employment and support allowance. The claimant's case is that the continued recovery of the overpayment in this way breaches her right in Article 1 of Protocol No. 1 of the European Convention on Human Rights ("ECHR" or "the Convention") to the peaceful enjoyment of her possessions. In addition she contends that the recovery of the overpayment is both irrational in public law terms and follows from an unlawful exercise of discretion in the circumstances of her case. Over the years the overpayment in the claimant's case has been the concern of a number of different offices, agencies and sections falling under the responsibility of the Secretary of State for Work and Pensions. For convenience I use the term "Department" to describe all of these offices, agencies and sections.
Background
The claimant was born in 1958. She had been in receipt of a benefit called income support in 1996. On 14 May 1997, one of the Department's adjudication officers decided that she had not been entitled to that benefit from 4 August 1996 because she had been in remunerative work. The adjudication officer had received evidence from the St Edmundsbury Borough Council in west Suffolk. The claimant then admitted being at a unit selling second hand furniture several days a week, five to six hours a day. She was paid ten percent on the sales she made. She also helped with house clearances and received cash from the owner of the business. In her first witness statement for these proceedings the claimant explains that she was in a relationship with this man over a number of years, which at times was volatile.
On 10 October 1997 the Department decided that the claimant had been overpaid income support in the sum of £4,782.85. The letter explained that she had "misrepresented the material fact that she had commenced remunerative work" and that as a consequence she was paid that amount "which would not have been paid but for the misrepresentation". The letter set out that the overpayment was recoverable from her but if she wanted to appeal she could do so. In her first statement for these proceedings the claimant says that she was only ever paid pocket-money for what she did at the business and that the Department was given false information by the wife of the business owner.
The claimant wrote to the Department on 18 November 1997, including her income support order books. She explained that she was changing her address but that no other circumstances had changed. Although in that letter she said that she intended to appeal the Department's decision to recover the overpayment she never did so. In the first statement she prepared for these proceedings she says that there was so much happening in her life that she was struggling to cope and was not able to appeal.
The Department decided to recover the sum of £4,782.85 by way of deduction from benefit the claimant was then receiving. Deductions commenced on 24 November 1997 at the rate of £5 per week, until 16 February 1998, when she again began work and was thus no longer entitled to income support. In an undated letter, received by the Department on 3 March 1998 ("the 3 March 1998 letter"), the claimant made an offer of continued payment at the rate of £5 per week. She never made any payment pursuant to that offer. There was a letter from the Department the following day, requesting repayment of the amount. That letter does not refer to the claimant's offer letter and was sent to another address the Department had for her.
The first of the so called C2 and C6 letters from the Department, requesting repayment and threatening civil proceedings, were sent on 5 May and 19 May 1998 respectively to an address in Saffron Walden. This was the address from which she wrote the 3 March 1998 letter. Further deductions were made when the claimant once more claimed a prescribed benefit, jobseeker's allowance, between December 1998 and February 1999. C2 and C6 letters were sent on 9 and 23 April 1999 to another address the claimant had given to the Department when claiming benefit, at Castle Camps, Cambridgeshire. The third set of letters was sent on 9 and 23 May 2001. The address held by the Department at the time was in Haverhill which, according to the claimant's evidence, was where she stayed with her eldest daughter. The claimant does not recall having received any of the Department's letters. The letters were not returned to the Department as, for example, "not known at this address". There is no doubt that during this period she was leading a rather itinerant existence.
On the claimant's behalf it is accepted that she must have received at least one of those May 2001 letters, because on 4 June 2001 she telephoned the Department asking for a copy of the original notification of overpayment. This was sent out to her on the same day. She did not make any payment. After this the Department's contact with the claimant somewhat fizzles. Her recollection is that she hoped and assumed that the Department had decided to write off the debt. In 2004 she moved to Wales and has lived there ever since. She was in employment for most of the period between January 2002 until 2009. It seems that the Department held the claimant's Haverhill address until March 2005 and was then aware of at least some of her addresses in Wales. The Department referred her case for enforcement by private sector contractors in April 2004 and February 2006, but without success. There is no evidence about what they did to recover the overpayment.
In early 2010 the claimant claimed employment and support allowance, which is a benefit for those unable to work because of illness or disability. This prompted a decision by the Department to seek to recover the 1996–1997 overpayment by way of deductions from that benefit. At the claimant's request, deductions were suspended for three months from 31 March 2010 and then subsequently for six months in October 2010. Meanwhile the Cardigan and District Citizen's Advice Bureau ("the Cardigan CAB") had taken up the claimant's case. One of its case-workers wrote to the Department on 26 August 2010 requesting that it waive recovery of the overpayment because of the lapse of time since the overpayment, its failure to pursue matters, the severe financial hardship recovery would cause and the claimant's health problems. A letter from the claimant's GP was enclosed, written to "help [the claimant] in her claim for her benefits". It referred, amongst other things, to her "anxiety depression issues".
The Department refused to abandon or waive the claim for recovery. In a letter of 7 September 2010 it explained that it would abandon a claim to more than £300 due to recovery having broken down if twenty years had elapsed and no recovery had taken place. That was not the claimant's position. As regards the waiver of the overpayment, this was refused on 7 October 2010.
The Public Law Project sent a letter of claim on 6 January 2011. The Defendant responded on 14 January. Later that month the Department wrote to the Cardigan CAB that it had re-examined the case for waiver but would not change the previous decision. The claimant's current financial hardship was met by the suspension. The medical evidence was insufficient and did not indicate that the claimant's health would not improve. The claim form was then lodged. Although delay was raised in the Acknowledgment of Service Collins J, when granting permission, stated that he would extend time if necessary. Delay in lodging the claim is no longer an issue in this case.
The legislative and policy framework
It is generally a condition of entitlement to benefit that a claimant makes a claim for it: section 1 of the Social Security Administration Act 1992 ("the 1992 Act"). It is for the Secretary of State to make a decision on a claim for benefit under section 8 of the Social Security Act 1998 ("the 1998 Act"). Such a decision can be altered by being revised or superseded under sections 9 and 10 of the 1998 Act or on appeal pursuant to section 12. Otherwise, decisions are final: section 17. Generally, an award of benefit is made for an indefinite period: regulation 17(1) of the Social Security (Claims and Payments) Regulations 1987, 1987 SI No 1968 ("the 1987 Regulations"). Under regulation 20 of the 1987 Regulations there is an obligation to make payment "in accordance with an award".
Under section 71 of the 1992 Act an overpayment of benefit may be recovered. The section provides for recovery from a person who has misrepresented or failed to disclose a material fact: s. 71(1), (3). There are various methods of recovery of overpaid benefit. By section 71(8), where an overpayment is recoverable under section 71(1)
"…. it may, without prejudice to any other method of recovery, be recovered by deduction from prescribed benefits."
Under regulation 15(1) of the Social...
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